P₁ P₂ P3 D Q₁ B D Q₂ Q3 Quantity At price P₁ you at price P2 you and at price P3 you a. will have no trouble buying tennis balls; will find all the tennis balls you wish to buy; may not find any tennis balls to buy b. may not find any tennis balls to buy; will find all the tennis balls you wish to buy; will have no trouble buying tennis balls e. will find all the tennis balls you wish to buy; may not find any tennis balls to buy; will have no trouble buying tennis balls d. will have no trouble buying tennis balls; may not find any tennis balls to buy; will find all the tennis balls you wish to buy

P₁ P₂ P3 D Q₁ B D Q₂ Q3 Quantity At price P₁ you at price P2 you and at price P3 you a. will have no trouble buying tennis balls; will find all the tennis balls you wish to buy; may not find any tennis balls to buy b. may not find any tennis balls to buy; will find all the tennis balls you wish to buy; will have no trouble buying tennis balls e. will find all the tennis balls you wish to buy; may not find any tennis balls to buy; will have no trouble buying tennis balls d. will have no trouble buying tennis balls; may not find any tennis balls to buy; will find all the tennis balls you wish to buy

Principles of Microeconomics

7th Edition

ISBN:9781305156050

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter5: Elastic And Its Application

Section: Chapter Questions

Problem 6PA: Suppose that your demand schedule for DVDs is as follows: Price Quantity Demanded (income = 10,000)...

See similar textbooks

Similar questions

Economists define normal goods as having a positive income elasticity. We can divide normal goods into two types: Those whose income elasticity is less than one and those whose income elasticity is greater than one. Think about products that would fall into each category. Can you come up with a name for each category?
Suppose you could buy shoes one at a time, miter than in pain. What do you predict the cross-price elasticity for left shoes and right shoes would be?
(Figure: The Demand for Online Movies) Use Figure: The Demand for Online Movies. If the price of online movies decreases from $6 to $4, total revenue which means that demand is Price $10 8 6 4 30 60 90 Quantity Ochanges from $60 to $90; elastic o remains constant; unit-elastic changes from $240 to $360; elastic Ochanges from $40 to $50; inelastic
d. What does this tell you about the relationship between muffins and coffee when the price of coffee increases by 10%? What will happen to the demand for both muffins and coffee?
1. The graph below shows the demand curve of two goods by an individual, use the information in the graph to answer the questions that follows; Price GH¢30.00 A GH¢25.00| C D1 D2 2000 2500 3000 Quantity (gallons per day) (a) Calculate the price elasticity of demand for the demand curve, D1, from point A to point C, and the price elasticity of demand for D2 from point A to point B. which demand curve is more elastic, Di or D2? Briefly explain your answer. (b) Given the expenditure function as e(p.q)=pg where p is the price and q is quantity demand. Suppose the individual was purchasing 2000 gallons per day at a price of GH¢30.00 per gallon and the price is cut to GH¢25.00 per gallon. calculate the | change in total expenditure if the demand curve of the individual is D1? What will be the change in total expenditure if demand is D2? 2. Discuss any four factors that would cause an increase in demand of petroleum engineering program in Ghanaian universities.
6. Determinants of price elasticity of demand Consider some determinants of the price elasticity of demand: The availability of substitutes • The market used to measure demand • The share of budget spent on the product • The time horizon being considered A good without any close substitutes is likely to have relatively the price of the good rises. The price elasticity of demand for a good also depends on how broadly the good is defined. Organize the goods found in the following table by indicating which is likely to have the most elastic demand, which is likely to have the least elastic demand, and which will have a demand elasticity that falls in between. Categories Most Elastic In Between Least Elastic Beverages Wine Merlot demand, because consumers cannot easily switch to a substitute good if Price elasticity for a good also depends on the share of a consumer's budget spent on a good. Other things being equal, which of the following goods has the most elastic demand? TV and Internet…
13. Refer to the diagram below. Good Y U, YA U. Xg XA Good X The budget line shift that moves the consumer's equilibrium from point A to point B suggests: A. a decrease in the quantity demanded for product X. B. a decrease in the demand for product X. C. no change in the demand for product X. D. that X is an inferior good.
(Figure: The Demand for Winter Gloves) Use Figure: The Demand for Winter Gloves. The price elasticity of demand over the segment EF, computed using the midpoint method, is: Price of gloves A $60 B 50 40 30 20 10 G 600 Quantity (per day) 100 200 300 400 500 greater than 1. less than the price elasticity of demand over segment FG. less than the price elasticity of demand over segment DE. O greater than the price elasticity of demand over segment AB.
Suppose that the demand and supply schedules for raisins in South Carolina are as fallows, quantitiesare measured in millions of packs per month. What is the quantity of raisins bought if the price is 50cents ? Price (cents per pack) Quantity demanded20 18030 16040 14050 12060 10070 8080 60 a) 120b) 180c) 100
A rise in the price of a crate of Pepsi from USD 20 to USD 30 results in a fall in the quantity of crate of Pepsi demanded from 220 million to 180 million a day and at today’s price of a Coca-Cola, USD 15, the quantity of Coca-Cola demanded increases from 80 million to 100 million a day. Kindly Answer ONLY (d) a). Calculate the percentage change in the price of a crate of Pepsi and the percentage change in the quantity demanded of Pepsi. Use the average price and average quantity.b). Calculate the price elasticity of demand for Pepsi. c). Is the demand for Pepsi elastic or inelastic? Explain please d). Calculate and explain the cross elasticity of demand for Coca-cola with respect to the price of a Pepsi.
23) Suppose the price elasticity of demand for a product is 1.8. If a supplier wants to increase revenue, they shoud (increase or decrease price- SELECT ONE) increase 24) Goods that are considered luxuries tend to be more (price elastic or price inelastic- SELECT ONE)price elastic 25) When the price is increased and total revenues increase, the elasticity of demand is (price elastic or price inelastic- SELECT ONE)price inelastic
5. Law of Demand Suppose that business travelers and vacationers have the following demand for airline tickets from New York to Boston: Price Quantity Demanded by Business Travelers Quantity Demanded by Vacationers (Dollars) (Tickets) (Tickets) 150 2,100 1,000 200 2,000 800 250 1,900 600 300 1,800 400 As the price of tickets rises from $150 to $200, the price elasticity of demand for business travelers is and the price elasticity of demand for vacationers is , using the midpoint method. Therefore, the demand for airline tickets in this price range is v elastic for vacationers because business travelers are v sensitive to changes in price.